Press Releases

Governor signs bill to lower income tax rate

Hughes' legislation delivers real savings for Michigan taxpayers

Gov. Rick Snyder today signed legislation to lower the personal income tax rate and increase the amount taxpayers will receive in tax refunds in the spring, saving Michigan taxpayers over $90 million, state Rep. Holly Hughes announced.

"We have come a long way since the billion dollar debt we started with in 2010 and this year we can continue to make decisions for Michigan's long term," said Hughes, R-Montague. "Last year's small business tax cut brought our state up from the bottom of the national rankings, making our state more competitive for jobs. This tax cut is an investment back into the people of the state of Michigan--We are now able to give back to the taxpayers after their sharing in the sacrifice and patience during tough times."

House Bill 5700, sponsored by state Rep. Holly Hughes, increases the personal tax exemption from $3,700 per person to $3,950 per person beginning on Oct. 1, 2012. The exemption will increase to $4,000 on Jan. 1, 2014, and remain at that amount. HB 5699, sponsored by state Rep. Ed McBroom, R-Vulcan, lowers the income tax rate from 4.35 percent to 4.25 percent. The reduction goes into effect on Oct. 1, 2012, as opposed to the originally scheduled date of Jan. 1, 2013.

Reducing the income tax rate to 4.25 percent means all Michigan taxpayers will receive broad-based tax relief, resulting in more money for their own household budget.

The tax exemption increase will result in an additional $1,000 exemption claim for a family of four, plus an additional $600 waiver by the third year.

"This tax relief will make a big difference for Michigan residents and make our state more attractive to businesses looking to hire," Hughes said. "I'm pleased the governor signed this legislation and that we're able to start giving back."

The bills now are Public Acts 223 and 224 of 2012.